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Western Midstream Announces Second-Quarter 2023 Results

Announces Revised 2023 Guidance

  • Reported second-quarter 2023 Net income attributable to limited partners of $247.1 million, generating second-quarter Adjusted EBITDA(1) of $488.3 million.
  • Reported second-quarter 2023 Cash flows provided by operating activities of $490.8 million, generating second-quarter Free cash flow(1) of $340.1 million.
  • Announced a second-quarter Base Distribution of $0.5625 per unit, or $2.25 on an annualized basis, which represents a 12.5-percent increase to the prior-quarter’s Base Distribution.
  • Repurchased $117.6 million of near-term senior notes at approximately 94-percent of par during the second quarter, and subsequent to quarter end, repurchased an additional $159.1 million of senior notes.
  • Revised 2023 Adjusted EBITDA(2) guidance to range between $1.950 billion and $2.050 billion, a reduction of approximately 5-percent at the midpoint.
  • Revised 2023 Free cash flow(2) guidance to range between $900.0 million and $1.000 billion as a result of revised Adjusted EBITDA guidance.

Today Western Midstream Partners, LP (NYSE: WES) (“WES” or the “Partnership”) announced second-quarter 2023 financial and operating results. Net income (loss) attributable to limited partners for the second quarter of 2023 totaled $247.1 million, or $0.64 per common unit (diluted), with second-quarter 2023 Adjusted EBITDA(1) totaling $488.3 million. Second-quarter 2023 Cash flows provided by operating activities totaled $490.8 million, and second-quarter 2023 Free cash flow(1) totaled $340.1 million.

RECENT HIGHLIGHTS

  • Achieved record Delaware Basin natural-gas throughput of 1.59 Bcf/d for the second quarter, representing a 1-percent sequential-quarter increase.
  • Gathered record Delaware Basin crude-oil and NGLs throughput of 208 MBbls/d for the second quarter, representing a 1-percent sequential-quarter increase.
  • Announced a new 250 MMcf/d cryogenic processing plant in the North Loving area of our West Texas complex (“North Loving Plant”) underpinned by previously announced commercial agreements containing significant minimum-volume commitments.
  • Obtained full investment-grade ratings after receiving an upgrade to BBB- from Fitch in May.

On August 14, 2023, WES will pay its second-quarter 2023 per-unit Base Distribution of $0.5625, representing a 12.5-percent sequential-quarter increase to the Partnership’s first-quarter Base Distribution. Second-quarter 2023 Free cash flow(1) after distributions, which included the payment of our first Enhanced Distribution, totaled $3.1 million. Second-quarter 2023 and year-to-date capital expenditures(3) totaled $184.3 million and $363.6 million, respectively.

Second-quarter 2023 natural-gas throughput(4) averaged 4.3 Bcf/d, representing a 4-percent sequential-quarter increase. Second-quarter 2023 throughput for crude-oil and NGLs assets(4) averaged 626 MBbls/d, representing a 2-percent sequential-quarter increase. Second-quarter 2023 throughput for produced-water assets(4) averaged 943 MBbls/d, representing a 1-percent sequential-quarter decrease.

“Once again, we experienced record natural-gas and crude-oil and NGLs throughput in the Delaware Basin,” said Michael Ure, President and Chief Executive Officer. “Additionally, second-quarter throughput from our Utah and Wyoming assets increased as inclement weather experienced during the first quarter subsided, driving an overall increase in our natural-gas and crude-oil volumes.”

Mr. Ure continued, “Despite these throughput increases, second-quarter Adjusted EBITDA declined on a sequential-quarter basis primarily due to an expected seasonal increase in operation and maintenance expense and normalized property and other taxes.”

“We still anticipate year-over-year throughput growth across all three products. However, producer operational challenges appeared during the second quarter when new wells came online and outperformed expectations leading to challenges across the production chain. Based on discussions with our producers and after analyzing their revised forecasts, we expect these challenges to be temporary in nature. However, we do expect these challenges to continue into the second half of 2023, causing year-over-year growth to be at a slower pace than our initial expectations.”

“These throughput changes, specifically in the Delaware Basin, have caused us to revise our 2023 Adjusted EBITDA guidance range to $1.950 billion to $2.050 billion, a reduction of approximately 5-percent at the midpoint. With that said, we continue to believe that our producers will meet their volume expectations over the long-run, and the outperformance from the most recent wells further support our belief that our assets service the best rock in the Delaware Basin.”

“While we are disappointed in the new outlook for the second half of 2023, we are confident in the protections that our stable, long-term contract structures provide. In situations such as these, when current year cash flow expectations decline due to volumetric changes, the protections included in our cost-of-service contracts should benefit WES in future periods, allowing us to still earn our stated rate of return over the life of the contract.”

“Subsequent to quarter end, we announced a 12.5-percent increase in the quarterly Base Distribution to $0.5625 per unit. Our ability to significantly reduce leverage, coupled with numerous commercial successes, supported this distribution increase. Additionally, while our growth may be more weighted towards 2024 than originally anticipated, our confidence in our underlying business and contract structures reaffirms our decision regarding the Base Distribution increase and our view that the long-term trajectory of WES remains strong. Furthermore, our investment-grade balance sheet and strong financial position continue to provide optionality and allow us to continue generating long-term value for our stakeholders.”

“WES remains committed to executing on its balanced approach of returning capital to our stakeholders. During the second quarter, we utilized a portion of the net proceeds from our $750 million senior notes issuance in mid-March to repurchase $117.6 million of near-term maturity senior notes at approximately 94-percent of par. These activities have continued into the third quarter, and we have now repurchased a total of $276.7 million of senior notes to date since the beginning of the second quarter.”

“Moving to operations, in May, we announced the sanctioning of the 250 MMcf/d North Loving Plant to support our producers’ long-term throughput growth needs in the Delaware Basin. This new plant is supported by long-term commercial agreements with significant minimum-volume commitments, and is expected to be online by the end of 2024, or early 2025. Together with Mentone Train III, we are growing our Delaware Basin processing capacity by approximately 36-percent, securing our position as one of the leading natural-gas processors in the Delaware Basin,” concluded Mr. Ure.

REVISED 2023 GUIDANCE

Based on the most current production forecast information from our producer customers, WES is providing revised 2023 guidance as follows:

  • Adjusted EBITDA(2) between $1.950 billion and $2.050 billion.
  • Total capital expenditures(3) between $700.0 million to $800.0 million, which is unchanged since our May 2023 North Loving Plant announcement.
  • Free cash flow(2) between $900.0 million and $1.000 billion, in line with the decrease in Adjusted EBITDA guidance.
  • Full-year 2023 Base Distribution of at least $2.1875 per unit(5), which is unchanged since our July 2023 Base Distribution increase announcement, excludes the impact of a potential Enhanced Distribution.

CONFERENCE CALL TOMORROW AT 1:00 P.M. CT

WES will host a conference call on Wednesday, August 9, 2023, at 1:00 p.m. Central Time (2:00 p.m. Eastern Time) to discuss its second-quarter 2023 results. To participate, individuals should dial 888-770-7129 (Domestic) or 929-203-2109 (International) ten to fifteen minutes before the scheduled conference call time and enter the participant access code 2187921. To access the live audio webcast of the conference call, please visit the investor relations section of the Partnership’s website at www.westernmidstream.com. A replay of the conference call also will be available on the website following the call.

For additional details on WES’s financial and operational performance, please refer to the earnings slides and updated investor presentation available at www.westernmidstream.com.

ABOUT WESTERN MIDSTREAM

Western Midstream Partners, LP (“WES”) is a Delaware master limited partnership formed to acquire, own, develop, and operate midstream assets. With midstream assets located in Texas, New Mexico, Colorado, Utah, Wyoming, and Pennsylvania, WES is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural-gas liquids, and crude oil; and gathering and disposing of produced water for its customers. In its capacity as a natural-gas processor, WES also buys and sells natural gas, natural-gas liquids, and condensate on behalf of itself and as an agent for its customers under certain contracts.

For more information about Western Midstream Partners, LP, please visit www.westernmidstream.com.

This news release contains forward-looking statements. WES’s management believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove correct. A number of factors could cause actual results to differ materially from the projections, anticipated results, or other expectations expressed in this news release. These factors include our ability to meet financial guidance or distribution expectations; our ability to safely and efficiently operate WES’s assets; the supply of, demand for, and price of oil, natural gas, NGLs, and related products or services; our ability to meet projected in-service dates for capital-growth projects; construction costs or capital expenditures exceeding estimated or budgeted costs or expenditures; and the other factors described in the “Risk Factors” section of WES’s most-recent Form 10-K filed with the Securities and Exchange Commission and other public filings and press releases. WES undertakes no obligation to publicly update or revise any forward-looking statements.

_______________________________________

(1)

Please see the definitions of the Partnership’s non-GAAP measures at the end of this release and reconciliation of GAAP to non-GAAP measures.

(2)

A reconciliation of the Adjusted EBITDA range to net cash provided by operating activities and net income (loss), and a reconciliation of the Free cash flow range to net cash provided by operating activities, is not provided because the items necessary to estimate such amounts are not reasonably estimable at this time. These items, net of tax, may include, but are not limited to, impairments of assets and other charges, divestiture costs, acquisition costs, or changes in accounting principles. All of these items could significantly impact such financial measures. At this time, WES is not able to estimate the aggregate impact, if any, of these items on future period reported earnings. Accordingly, WES is not able to provide a corresponding GAAP equivalent for the Adjusted EBITDA or Free cash flow ranges.

(3)

Accrual-based, includes equity investments, excludes capitalized interest, and excludes capital expenditures associated with the 25% third-party interest in Chipeta.

(4)

Represents total throughput attributable to WES, which excludes (i) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary and (ii) for natural-gas throughput, the 25% third-party interest in Chipeta, which collectively represent WES’s noncontrolling interests.

(5)

Subject to Board review and approval on a quarterly basis based on the needs of the business.

Western Midstream Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

thousands except per-unit amounts

 

2023

 

2022

 

2023

 

2022

Revenues and other

 

 

 

 

 

 

 

 

Service revenues – fee based

 

$

661,506

 

 

$

655,952

 

 

$

1,309,373

 

 

$

1,287,550

 

Service revenues – product based

 

 

46,956

 

 

 

70,498

 

 

 

93,766

 

 

 

111,365

 

Product sales

 

 

29,659

 

 

 

149,736

 

 

 

68,684

 

 

 

235,325

 

Other

 

 

152

 

 

 

233

 

 

 

432

 

 

 

476

 

Total revenues and other

 

 

738,273

 

 

 

876,419

 

 

 

1,472,255

 

 

 

1,634,716

 

Equity income, net – related parties

 

 

42,324

 

 

 

48,464

 

 

 

81,345

 

 

 

98,071

 

Operating expenses

 

 

 

 

 

 

 

 

Cost of product

 

 

44,746

 

 

 

148,556

 

 

 

96,205

 

 

 

221,404

 

Operation and maintenance

 

 

183,431

 

 

 

168,153

 

 

 

357,670

 

 

 

297,129

 

General and administrative

 

 

53,405

 

 

 

47,848

 

 

 

104,522

 

 

 

96,450

 

Property and other taxes

 

 

18,547

 

 

 

22,662

 

 

 

25,378

 

 

 

41,104

 

Depreciation and amortization

 

 

143,492

 

 

 

139,036

 

 

 

288,118

 

 

 

273,618

 

Long-lived asset and other impairments

 

 

234

 

 

 

90

 

 

 

52,635

 

 

 

90

 

Total operating expenses

 

 

443,855

 

 

 

526,345

 

 

 

924,528

 

 

 

929,795

 

Gain (loss) on divestiture and other, net

 

 

(70

)

 

 

(1,150

)

 

 

(2,188

)

 

 

(780

)

Operating income (loss)

 

 

336,672

 

 

 

397,388

 

 

 

626,884

 

 

 

802,212

 

Interest expense

 

 

(86,182

)

 

 

(80,772

)

 

 

(167,852

)

 

 

(166,227

)

Gain (loss) on early extinguishment of debt

 

 

6,813

 

 

 

91

 

 

 

6,813

 

 

 

91

 

Other income (expense), net

 

 

2,872

 

 

 

(45

)

 

 

4,087

 

 

 

61

 

Income (loss) before income taxes

 

 

260,175

 

 

 

316,662

 

 

 

469,932

 

 

 

636,137

 

Income tax expense (benefit)

 

 

659

 

 

 

1,491

 

 

 

2,075

 

 

 

3,296

 

Net income (loss)

 

 

259,516

 

 

 

315,171

 

 

 

467,857

 

 

 

632,841

 

Net income (loss) attributable to noncontrolling interests

 

 

6,595

 

 

 

8,854

 

 

 

11,291

 

 

 

17,807

 

Net income (loss) attributable to Western Midstream Partners, LP

 

$

252,921

 

 

$

306,317

 

 

$

456,566

 

 

$

615,034

 

Limited partners’ interest in net income (loss):

 

 

 

 

 

 

 

 

Net income (loss) attributable to Western Midstream Partners, LP

 

$

252,921

 

 

$

306,317

 

 

$

456,566

 

 

$

615,034

 

General partner interest in net (income) loss

 

 

(5,821

)

 

 

(6,767

)

 

 

(10,507

)

 

 

(13,550

)

Limited partners’ interest in net income (loss)

 

$

247,100

 

 

$

299,550

 

 

$

446,059

 

 

$

601,484

 

Net income (loss) per common unit – basic

 

$

0.64

 

 

$

0.74

 

 

$

1.16

 

 

$

1.49

 

Net income (loss) per common unit – diluted

 

$

0.64

 

 

$

0.74

 

 

$

1.16

 

 

$

1.49

 

Weighted-average common units outstanding – basic

 

 

384,614

 

 

 

403,027

 

 

 

384,542

 

 

 

403,140

 

Weighted-average common units outstanding – diluted

 

 

385,510

 

 

 

404,162

 

 

 

385,665

 

 

 

404,280

 

Western Midstream Partners, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

thousands except number of units

 

June 30,

2023

 

December 31,

2022

Total current assets

 

$

797,203

 

$

900,425

Net property, plant, and equipment

 

 

8,600,970

 

 

8,541,600

Other assets

 

 

1,820,777

 

 

1,829,603

Total assets

 

$

11,218,950

 

$

11,271,628

Total current liabilities

 

$

621,544

 

$

903,857

Long-term debt

 

 

6,824,214

 

 

6,569,582

Asset retirement obligations

 

 

301,975

 

 

290,021

Other liabilities

 

 

449,054

 

 

400,053

Total liabilities

 

 

8,196,787

 

 

8,163,513

Equity and partners’ capital

 

 

 

 

Common units (384,613,934 and 384,070,984 units issued and outstanding at June 30, 2023, and December 31, 2022, respectively)

 

 

2,888,745

 

 

2,969,604

General partner units (9,060,641 units issued and outstanding at June 30, 2023, and December 31, 2022)

 

 

322

 

 

2,105

Noncontrolling interests

 

 

133,096

 

 

136,406

Total liabilities, equity, and partners’ capital

 

$

11,218,950

 

$

11,271,628

Western Midstream Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

Six Months Ended

June 30,

thousands

 

2023

 

2022

Cash flows from operating activities

 

 

 

 

Net income (loss)

 

$

467,857

 

 

$

632,841

 

Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in assets and liabilities:

 

 

 

 

Depreciation and amortization

 

 

288,118

 

 

 

273,618

 

Long-lived asset and other impairments

 

 

52,635

 

 

 

90

 

(Gain) loss on divestiture and other, net

 

 

2,188

 

 

 

780

 

(Gain) loss on early extinguishment of debt

 

 

(6,813

)

 

 

(91

)

Change in other items, net

 

 

(10,738

)

 

 

(163,799

)

Net cash provided by operating activities

 

$

793,247

 

 

$

743,439

 

Cash flows from investing activities

 

 

 

 

Capital expenditures

 

$

(334,570

)

 

$

(191,357

)

Contributions to equity investments - related parties

 

 

(132

)

 

 

(5,040

)

Distributions from equity investments in excess of cumulative earnings – related parties

 

 

23,179

 

 

 

25,407

 

Proceeds from the sale of assets to third parties

 

 

 

 

 

1,096

 

(Increase) decrease in materials and supplies inventory and other

 

 

(19,145

)

 

 

(1,053

)

Net cash used in investing activities

 

$

(330,668

)

 

$

(170,947

)

Cash flows from financing activities

 

 

 

 

Borrowings, net of debt issuance costs

 

$

956,225

 

 

$

634,010

 

Repayments of debt

 

 

(918,332

)

 

 

(883,548

)

Increase (decrease) in outstanding checks

 

 

(2,951

)

 

 

13,038

 

Distributions to Partnership unitholders

 

 

(533,556

)

 

 

(340,946

)

Distributions to Chipeta noncontrolling interest owner

 

 

(3,470

)

 

 

(3,182

)

Distributions to noncontrolling interest owner of WES Operating

 

 

(11,131

)

 

 

(8,812

)

Net contributions from (distributions to) related parties

 

 

 

 

 

784

 

Unit repurchases

 

 

(7,102

)

 

 

(79,217

)

Other

 

 

(14,965

)

 

 

(9,184

)

Net cash provided by (used in) financing activities

 

$

(535,282

)

 

$

(677,057

)

Net increase (decrease) in cash and cash equivalents

 

$

(72,703

)

 

$

(104,565

)

Cash and cash equivalents at beginning of period

 

 

286,656

 

 

 

201,999

 

Cash and cash equivalents at end of period

 

$

213,953

 

 

$

97,434

 

Western Midstream Partners, LP

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

WES defines Adjusted gross margin attributable to Western Midstream Partners, LP (“Adjusted gross margin”) as total revenues and other (less reimbursements for electricity-related expenses recorded as revenue), less cost of product, plus distributions from equity investments, and excluding the noncontrolling interest owners’ proportionate share of revenues and cost of product.

WES defines Adjusted EBITDA as net income (loss), plus (i) distributions from equity investments, (ii) non-cash equity-based compensation expense, (iii) interest expense, (iv) income tax expense, (v) depreciation and amortization, (vi) impairments, and (vii) other expense (including lower of cost or market inventory adjustments recorded in cost of product), less (i) gain (loss) on divestiture and other, net, (ii) gain (loss) on early extinguishment of debt, (iii) income from equity investments, (iv) interest income, (v) income tax benefit, (vi) other income, and (vii) the noncontrolling interest owners’ proportionate share of revenues and expenses.

WES defines Free cash flow as net cash provided by operating activities less total capital expenditures and contributions to equity investments, plus distributions from equity investments in excess of cumulative earnings. Management considers Free cash flow an appropriate metric for assessing capital discipline, cost efficiency, and balance-sheet strength. Although Free cash flow is the metric used to assess WES’s ability to make distributions to unitholders, this measure should not be viewed as indicative of the actual amount of cash that is available for distributions or planned for distributions for a given period. Instead, Free cash flow should be considered indicative of the amount of cash that is available for distributions, debt repayments, and other general partnership purposes.

Below are reconciliations of (i) gross margin (GAAP) to Adjusted gross margin (non-GAAP), (ii) net income (loss) (GAAP) and net cash provided by operating activities (GAAP) to Adjusted EBITDA (non-GAAP), and (iii) net cash provided by operating activities (GAAP) to Free cash flow (non-GAAP), as required under Regulation G of the Securities Exchange Act of 1934. Management believes that Adjusted gross margin, Adjusted EBITDA, and Free cash flow are widely accepted financial indicators of WES’s financial performance compared to other publicly traded partnerships and are useful in assessing WES’s ability to incur and service debt, fund capital expenditures, and make distributions. Adjusted gross margin, Adjusted EBITDA, and Free cash flow as defined by WES, may not be comparable to similarly titled measures used by other companies. Therefore, WES’s Adjusted gross margin, Adjusted EBITDA, and Free cash flow should be considered in conjunction with net income (loss) attributable to Western Midstream Partners, LP and other applicable performance measures, such as gross margin or cash flows provided by operating activities.

Western Midstream Partners, LP

RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED)

(Unaudited)

Adjusted Gross Margin

 

 

 

Three Months Ended

thousands

 

June 30,

2023

 

March 31,

2023

Reconciliation of Gross margin to Adjusted gross margin

 

 

 

 

Total revenues and other

 

$

738,273

 

$

733,982

Less:

 

 

 

 

Cost of product

 

 

44,746

 

 

51,459

Depreciation and amortization

 

 

143,492

 

 

144,626

Gross margin

 

 

550,035

 

 

537,897

Add:

 

 

 

 

Distributions from equity investments

 

 

54,075

 

 

51,975

Depreciation and amortization

 

 

143,492

 

 

144,626

Less:

 

 

 

 

Reimbursed electricity-related charges recorded as revenues

 

 

23,286

 

 

23,569

Adjusted gross margin attributable to noncontrolling interests (1)

 

 

16,914

 

 

15,774

Adjusted gross margin

 

$

707,402

 

$

695,155

 

 

 

 

 

Gross margin

 

 

 

 

Gross margin for natural-gas assets (2)

 

$

409,634

 

$

393,673

Gross margin for crude-oil and NGLs assets (2)

 

 

88,024

 

 

89,281

Gross margin for produced-water assets (2)

 

 

59,130

 

 

59,549

Adjusted gross margin

 

 

 

 

Adjusted gross margin for natural-gas assets

 

$

489,476

 

$

480,009

Adjusted gross margin for crude-oil and NGLs assets

 

 

147,036

 

 

145,577

Adjusted gross margin for produced-water assets

 

 

70,890

 

 

69,569

(1)

For all periods presented, includes (i) the 25% third-party interest in Chipeta and (ii) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary, which collectively represent WES’s noncontrolling interests.

(2)

Excludes corporate-level depreciation and amortization.

Western Midstream Partners, LP

RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED)

(Unaudited)

Adjusted EBITDA

 

 

 

Three Months Ended

thousands

 

June 30,

2023

 

March 31,

2023

Reconciliation of Net income (loss) to Adjusted EBITDA

 

 

 

 

Net income (loss)

 

$

259,516

 

 

$

208,341

 

Add:

 

 

 

 

Distributions from equity investments

 

 

54,075

 

 

 

51,975

 

Non-cash equity-based compensation expense

 

 

7,665

 

 

 

7,199

 

Interest expense

 

 

86,182

 

 

 

81,670

 

Income tax expense

 

 

659

 

 

 

1,416

 

Depreciation and amortization

 

 

143,492

 

 

 

144,626

 

Impairments

 

 

234

 

 

 

52,401

 

Other expense

 

 

199

 

 

 

200

 

Less:

 

 

 

 

Gain (loss) on divestiture and other, net

 

 

(70

)

 

 

(2,118

)

Gain (loss) on early extinguishment of debt

 

 

6,813

 

 

 

 

Equity income, net – related parties

 

 

42,324

 

 

 

39,021

 

Other income

 

 

2,872

 

 

 

1,215

 

Adjusted EBITDA attributable to noncontrolling interests (1)

 

 

11,737

 

 

 

11,015

 

Adjusted EBITDA

 

$

488,346

 

 

$

498,695

 

Reconciliation of Net cash provided by operating activities to Adjusted EBITDA

 

 

 

 

Net cash provided by operating activities

 

$

490,823

 

 

$

302,424

 

Interest (income) expense, net

 

 

86,182

 

 

 

81,670

 

Accretion and amortization of long-term obligations, net

 

 

(2,403

)

 

 

(1,692

)

Current income tax expense (benefit)

 

 

728

 

 

 

492

 

Other (income) expense, net

 

 

(2,872

)

 

 

(1,215

)

Distributions from equity investments in excess of cumulative earnings – related parties

 

 

10,813

 

 

 

12,366

 

Changes in assets and liabilities:

 

 

 

 

Accounts receivable, net

 

 

(4,078

)

 

 

4,037

 

Accounts and imbalance payables and accrued liabilities, net

 

 

(36,885

)

 

 

136,460

 

Other items, net

 

 

(42,225

)

 

 

(24,832

)

Adjusted EBITDA attributable to noncontrolling interests (1)

 

 

(11,737

)

 

 

(11,015

)

Adjusted EBITDA

 

$

488,346

 

 

$

498,695

 

Cash flow information

 

 

 

 

Net cash provided by operating activities

 

$

490,823

 

 

$

302,424

 

Net cash used in investing activities

 

 

(151,490

)

 

 

(179,178

)

Net cash provided by (used in) financing activities

 

 

(238,025

)

 

 

(297,257

)

(1)

For all periods presented, includes (i) the 25% third-party interest in Chipeta and (ii) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary, which collectively represent WES’s noncontrolling interests.

Western Midstream Partners, LP

RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED)

(Unaudited)

Free Cash Flow

 

 

 

Three Months Ended

thousands

 

June 30,

2023

 

March 31,

2023

Reconciliation of Net cash provided by operating activities to Free cash flow

 

 

 

 

Net cash provided by operating activities

 

$

490,823

 

 

$

302,424

 

Less:

 

 

 

 

Capital expenditures

 

 

161,482

 

 

 

173,088

 

Contributions to equity investments – related parties

 

 

22

 

 

 

110

 

Add:

 

 

 

 

Distributions from equity investments in excess of cumulative earnings – related parties

 

 

10,813

 

 

 

12,366

 

Free cash flow

 

$

340,132

 

 

$

141,592

 

Cash flow information

 

 

 

 

Net cash provided by operating activities

 

$

490,823

 

 

$

302,424

 

Net cash used in investing activities

 

 

(151,490

)

 

 

(179,178

)

Net cash provided by (used in) financing activities

 

 

(238,025

)

 

 

(297,257

)

Western Midstream Partners, LP

OPERATING STATISTICS

(Unaudited)

 

 

 

Three Months Ended

 

 

June 30,

2023

 

March 31,

2023

Throughput for natural-gas assets (MMcf/d)

 

 

 

 

Gathering, treating, and transportation

 

 

395

 

 

369

Processing

 

 

3,567

 

 

3,454

Equity investments (1)

 

 

454

 

 

423

Total throughput

 

 

4,416

 

 

4,246

Throughput attributable to noncontrolling interests (2)

 

 

162

 

 

139

Total throughput attributable to WES for natural-gas assets

 

 

4,254

 

 

4,107

Throughput for crude-oil and NGLs assets (MBbls/d)

 

 

 

 

Gathering, treating, and transportation

 

 

316

 

 

309

Equity investments (1)

 

 

323

 

 

314

Total throughput

 

 

639

 

 

623

Throughput attributable to noncontrolling interests (2)

 

 

13

 

 

12

Total throughput attributable to WES for crude-oil and NGLs assets

 

 

626

 

 

611

Throughput for produced-water assets (MBbls/d)

 

 

 

 

Gathering and disposal

 

 

963

 

 

977

Throughput attributable to noncontrolling interests (2)

 

 

20

 

 

20

Total throughput attributable to WES for produced-water assets

 

 

943

 

 

957

Per-Mcf Gross margin for natural-gas assets (3)

 

$

1.02

 

$

1.03

Per-Bbl Gross margin for crude-oil and NGLs assets (3)

 

 

1.51

 

 

1.59

Per-Bbl Gross margin for produced-water assets (3)

 

 

0.68

 

 

0.68

 

 

 

 

 

Per-Mcf Adjusted gross margin for natural-gas assets (4)

 

$

1.26

 

$

1.30

Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (4)

 

 

2.58

 

 

2.65

Per-Bbl Adjusted gross margin for produced-water assets (4)

 

 

0.83

 

 

0.81

(1)

Represents our share of average throughput for investments accounted for under the equity method of accounting.

(2)

For all periods presented, includes (i) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary and (ii) for natural-gas assets, the 25% third-party interest in Chipeta, which collectively represent WES’s noncontrolling interests.

(3)

Average for period. Calculated as Gross margin for natural-gas assets, crude-oil and NGLs assets, or produced-water assets, divided by the respective total throughput (MMcf or MBbls) for natural-gas assets, crude-oil and NGLs assets, or produced-water assets.

(4)

Average for period. Calculated as Adjusted gross margin for natural-gas assets, crude-oil and NGLs assets, or produced-water assets, divided by the respective total throughput (MMcf or MBbls) attributable to WES for natural-gas assets, crude-oil and NGLs assets, or produced-water assets.

Western Midstream Partners, LP

OPERATING STATISTICS (CONTINUED)

(Unaudited)

 

 

 

Three Months Ended

 

 

June 30,

2023

 

March 31,

2023

Throughput for natural-gas assets (MMcf/d)

 

 

 

 

Delaware Basin

 

1,592

 

1,569

DJ Basin

 

1,309

 

1,306

Equity investments

 

454

 

423

Other

 

1,061

 

948

Total throughput for natural-gas assets

 

4,416

 

4,246

Throughput for crude-oil and NGLs assets (MBbls/d)

 

 

 

 

Delaware Basin

 

208

 

205

DJ Basin

 

66

 

69

Equity investments

 

323

 

314

Other

 

42

 

35

Total throughput for crude-oil and NGLs assets

 

639

 

623

Throughput for produced-water assets (MBbls/d)

 

 

 

 

Delaware Basin

 

963

 

977

Total throughput for produced-water assets

 

963

 

977

 

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